(TCO A) Use the following partial financial statement information below to calculate the liquidity and profitability ratios. This information can be used to correctly solve each of the ratios below.
|
Average common shares outstanding |
15,000 |
Current liabilities
|
$25,000
|
|
Capital expenditures |
$10,000 |
Net income
|
$30,000 |
|
Cash provided by operations |
$56,000 |
Net sales |
$90,000 |
|
Common stock dividends paid |
$30,000 |
Total liabilities |
$50,000 |
|
Current assets |
$35,000 |
Total assets |
$62,500 |
Instructions:
Compute the following.
a) Current ratio
b) Working capital
c) Earnings per share
d) Debt-to-total-assets ratio
e) Free cash flow
To earn full credit, you must show the formula you are using, show your computations, and explain the meaning of each of your ratio results.